Switzerland’s pre-referendum projections were upheld as the Swiss voted to reject the Gold Initiative. The “Save our Swiss Gold” initiative was voted down, 73 percent (anti) to 23 percent (pro). The referendum, if passed, involved preventing gold sales, repatriating Swiss-owned gold and storing gold reserves within the country, and mandating that gold must make up at least 20% of the assets ($540 billion in total) held by the SNB.
In the United States, Jobless Claims rose 313,000 in the previous week, greater than the 287,000 projection. Prelim GDP gained 3.9 percent compared to its estimate of only 3.3 percent.
US CB Consumer Confidence declined to 88.7 in November after bouncing to 94.1 in October. Durable Goods Orders and Pending Home Sales dipped surprisingly, -0.9 percent and 458,000 respectively. Meanwhile, Chicago PMI, Revised UoM Consumer Sentiment, and New Home Sales all came in lower than forecast.
In other news, Statistics Canada said September Retail Sales advanced 0.8 percent while the core reading turned flat. Current account deficit was reduced by CAD1.5 billion to 8.4 billion during the third quarter. Gross Domestic Product came in as expected at 0.4 percent.
Gold buyers had early trouble setting a strong pace above the $1,200 level. They tried but easily gave up, and this led to a subsequent three-day decline until Friday’s $27 drop. This gave gold its first weekly decline in four weeks. Continued weakness would spell trouble for the yellow metal.
Oil traders saw an $11 decline this week as the $70 level failed to give support to the ailing commodity. Since price is smashing through lower supports, we could see more volatility in the coming weeks. $50 to $60 could be the next critical area.
EURUSD managed to close the week higher despite the new multi-year low etched on Monday. The pair could see more consolidation in the same area, but bulls would need to push this higher so they can get out of this price glut. A move through 1.2700 would ease the bearish momentum.
USDJPY printed a weekly inside bar, breaking the five-week streak of higher weekly highs and lows. This could be the first sign of exhaustion in the current strong trend. Nevertheless, any downside moves is likely to be met by buyers. Watch 117-118.
GBPUSD closed the week unchanged as the pair encountered strong resistance above the 1.5800 level. Buyers need to make a second attempt to push through 1.5800. Some indicators are showing divergences, and this could aid the buyers in the coming weeks.
The Week Ahead
This Monday will be relatively packed with news throughout the day. It will begin with New Zealand’s Overseas Trade Index, succeeded by Australia’s Company Operating Profits; China’s Manufacturing PMI and HSBC Final Manufacturing PMI; Japan’s Capital Spending and Final Manufacturing PMI; Manufacturing PMI for Spain, Switzerland (SVME), Italy, UK, and the US. Fed members Dudley and Fischer will also give their respective speeches.
Tuesday will have Australia’s Building Approvals, Current Account, and RBA Rate Announcement and Statement; Japan’s Average Cash Earnings; Spain’s Unemployment Change; UK’s Construction PMI; New Zealand GDT Price Index; and US Fed Chair Yellen’s speech.
Wednesday will have Australia’s GDP; China’s Non-Manufacturing PMI and HSBC Services PMI; Spain, Italy, and UK Services PMI; Eurozone Retail Sales and Final Services PMI; UK Autumn Forecast Statement; Canada BOC Rate Announcement and Statement; US ADP Non-Farm Employment Change, ISM Non-Manufacturing PMI and Beige Book.
Thursday will also be busy with Australia’s Retail Sales and Trade Balance; UK Halifax PMI, Official Bank Rate, Asset Purchase Facility, and MPC Rate Statement; ECB Rate Announcement, Statement, and Press Conference; US Jobless Claims; Canada’s Ivey PMI.
Friday will have a quiet Asian session, followed by gradual pickup in activity from then on. There will be Germany’s Factory Orders; Switzerland’s Foreign Currency Reserves; Canada’s Trade Balance, Employment Change, Jobless Rate, and Labor Productivity; US Non-Farm Employment Change, Trade Balance, Jobless Rate, Factory Orders, and Average Hourly Earnings.